In this episode of The Economist Next Door, Paul Mueller is joined by fellow American Institute for Economic Research scholars Jeff Degner and Dave Hebert to examine the economics behind America's student debt crisis.

The conversation explores how decades of federal aid and subsidized student loans helped fuel tuition inflation, reshape university incentives, and transform higher education into a debt-driven consumption economy. The scholars discuss credential inflation, luxury campus amenities, signaling theory, Austrian business cycle theory, and the unintended consequences of government intervention in higher education.

They also examine why so many students leave school with debt but no degree, how colleges use price discrimination, and whether reforms such as shorter degree programs, income-sharing agreements, and AI-driven education tools could lower costs and improve outcomes.

No PhD required.